ZURICH, May 24 (Reuters) - Jean-Marc Decressonniere is probably the only banker in finance-friendly Switzerland who supports a vote next month that could transform how lenders operate.
Unlike virtually all his peers, Decressonniere backs the Sovereign Money initiative, which wants to stop commercial banks from in effect creating money every time they make a loan.
Supporters say their shake-up will make the financial system safer by ensuring the Swiss National Bank is the only authority permitted to produce new money in Switzerland.
The change would scrap fractional reserve banking, a mainstay of lending around the world, in which only a portion of bank deposits are backed by central bank money: notes, coins and bank deposits held at the SNB.
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Decressonniere, a 48-year-old director of the Freie Gemeinschaftsbank, a small bank in Basel, thinks changing the system would make the financial sector more stable and less prone to boom and busts.
"In future, it would be more sensible to have money administered by a central authority that is independent and looks at the whole economy," he said. "Commercial banks have a more limited perspective based on their own profit targets."
Around 90 percent of the money in circulation in Switzerland now is electronic money created by commercial banks, a situation which supporters of the campaign say is inherently unstable.
They propose de-risking the system by letting customers lodge their money in risk-free sovereign money accounts.
Banks in future would be able to lend only money they administer in savings accounts, or what they can get from the money markets or the SNB.
The initiative is opposed by the SNB, whose chairman, Thomas Jordan, says it would damage the central bank's ability to carry out independent monetary policy and subject it to political pressure.
The latest opinion poll showed just 35 percent support for the plan, which is subject to a binding referendum on June 10. But the SNB -- mindful of recent populist uprisings against executive pay and tax reforms -- is taking no chances .
Jordan has fired several broadsides against the initiative, which he has branded a" dangerous cocktail" for Switzerland .
Polls have got big decisions wrong in the past, as evidenced by Britain's Brexit vote and Donald Trump's U.S. election win.
But Lukas Golder, co-leader of pollsters GFS Bern, said chances for a sovereign money victory were remote.
"A 'no' result is the probable outcome," he said. "Unlike globalisation or migration issues, there has been no great mobilisation of voters."
Interest in sovereign money rose following the 2008 financial crisis after the Swiss government had to bail out UBS.
Supporters say that allowing customers sovereign money accounts with the SNB would reduce the risk that bank runs will wreck Switzerland's financial system.
"When you ask most people where their money comes from, they will say it is the SNB, but that's not true," said Maurizio Degiacomi, a leader of the campaign by academics and ex-bankers.
"When they learn that the money they use in their daily lives is actually produced by commercial banks, they want this changed."
The Swiss banking establishment disagrees, saying great strides have been made to improve stability via regulations that make banks hold more capital.
The changes would also lead to an increase in the price of credit and higher banking charges, Swiss Bankers Association (SBA) Chief Economist Martin Hess said. Lenders would have to go to the money markets, other banks or the SNB for funding because they could no longer use customers' current account deposits to finance loans.
In a study commissioned by the SBA, University of Lausanne economist Philippe Bacchetta reckoned a switch to sovereign money could cut Swiss gross domestic product by 0.4 percent.
"This plan has never been attempted anywhere else, and if Switzerland was the only place to do this, it would be really risky," said Jean-Charles Rochet, a University of Geneva economist.
The initiative would cause massive disruption to the Swiss banking system. Big banks could move their activities abroad so the regulations don't apply, or might offer only accounts in euro or dollars to get around it, he said.
"It's good to have a discussion, but this is too technical an issue to be decided in a simple yes-no referendum," said Rochet.
Still, Freie Gemeinschaftbank's Decressonnière thinks the time is right for a change.
"The other banks have their own interests to defend. Creating money is a privilege the banks have and the big banks profit to a greater extent from this," he said.
"It would be painful for them to lose this, so it's understandable why they are against it. But it is very surprising we are the only bank that supports the initiative." (Reporting by John Revill, editing by Larry King)